As of: 06.03.2009

 

• Title: Germany as a Partner to Asia in the Business and Environment Sector

• Speaker: Sigmar Gabriel, Federal Minister for the Environment, Nature Conservation and Nuclear Safety
• Occasion: 89th "Ostasiatisches Liebesmahl"
• Date/Location: 06.03.2009, Hamburg, Ostasiatischer Verein e.V. (OAV)

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Mr Fitschen, Dr Hambrecht, Dr Surin, Excellencies, Ladies and Gentlemen,

It gives me great pleasure as Federal Environment Minister to be here as guest speaker at this key event of the German Asia-Pacific Business Association. Business and environment are not mutually exclusive; business and environment belong together.

I.
There is increasing acceptance that ecological threats such as climate change also represent an economic opportunity and challenge. This conclusion of the 2006 review published by Nicholas Stern, the former chief economist of the World Bank, also applies in times of economic and financial crisis. There is a crucial parallel between the crisis and climate change. Acting too late leads to enormous costs - this applies equally to bail-out packages and climate protection.

As you know, the key message of the Stern Review is that neglected climate protection could cost up to 20% of our gross national product. In contrast, Stern estimates the costs of effective climate protection to be only 1% of our gross national product - on condition that we act now and not later.

We have calculated that if we implement our national climate protection targets efficiently we will be able to reduce spending on energy imports by several billion euro by the year 2020. And we are generating demand in employment-intensive, domestic sectors. This will create 500,000 new jobs by 2020, and at least 900,000 by 2030.

What progress have we made towards meeting our targets?

• Germany already met its obligations under the Kyoto Protocol last year and in 2010 we will exceed them. We have set ourselves the goal of a 40% reduction in greenhouse gas emissions by 2020 compared with 1990. In order to reach this target we are pursuing a twin-track strategy: the use of renewable energies and a reduction in energy consumption through energy efficiency measures.
• With the successful adoption of the European climate package last year we have moved a further step forward. The EU climate target was set at a 20% reduction in emissions by 2020. This reduction will even be raised to 30% as soon as an international follow-up agreement to the Kyoto Protocol is in place.
• In the emissions trading scheme, 100% of emission allowances for electricity production will be auctioned as planned. We have experienced that in the previous and current trading periods, electricity consumers were burdened with the costs for allowances that were actually allocated free of charge. This cashing-in twice must stop. In international climate protection we want to create clear impetus for a carbon price. At the same time, energy-intensive industry in Europe must be protected to prevent business shifting abroad in order to avoid distortions in competition and to ensure its climate protection efforts are not hindered.
• The most important decision is still ahead of us: in Copenhagen in December we have to agree on an ambitious follow-up agreement to the Kyoto Protocol. It is crucial to set challenging reduction targets for industrialised countries. However, at the same time newly industrialising countries must be involved in climate protection measures to a greater extent. This is the only way we can launch a transformation in energy systems towards a low carbon society.
• There is no doubt that the world's industrialised countries have caused climate change. However, it is also clear that these countries alone will no longer be able to stop climate change. The world also needs the commitment of newly industrialising countries.
• And we have no time to lose: last week, scientists from Stanford University and the Potsdam Institute for Climate Impact Research announced that the threshold to dangerous climate change could be overstepped sooner than previously assumed in IPCC reports. The European Union's goal of limiting global warming to 2°C is therefore not too ambitious. In fact it is a minimum requirement in order to minimise the risks of climate change.

Relaxing our climate policy efforts in view of the financial crisis would therefore be utterly wrong. Ambitious environmental policy is the key to innovation, growth and employment.

II.
Excellencies, Ladies and Gentlemen,

In view of the major economic and ecological challenges, demand for environmental and efficiency technologies is growing. The global market potential of these technologies was estimated to be around 1000 billion euro in 2005, and growth to over 2000 billion euro is predicted by 2020.

In the global economy, being the technology leader in the environmental sector is the best way to achieve long-term, secure prosperity. German companies have an excellent opportunity to profit from this. In many areas in which environmental policy has guided the way with targets and limit values, German companies are now world market leaders. These include the fields of renewable energies, energy efficiency and air pollution control.

The facts speak for themselves:

• Germany is yet again the export world champion in potential environmental goods.
• In 2006, Germany's share in world trade was 16%. This corresponds to an export volume of 56 billion euro.
• The US follows with a share of 15%, then Japan with 9%. China, too, is no longer only one of the main buyers of environment technologies; it is also becoming a powerful provider and competitor.

The fact that German companies are so well positioned in an international comparison has many reasons:

• A strong tradition in mechanical engineering, highly qualified staff and innovative engineers.
• But it is also thanks to an environmental policy that has set ambitious standards in the past, thus often becoming the benchmark internationally.
• We want Germany to remain a strong stakeholder. The export of potential environmental goods is also an important source of employment. Around 1.8 million people work in the environmental sector in Germany. This is already 4.5% of the total labour force.

The modernisation of our power plants and renewable energies can create millions of new jobs and sustainable economic growth. The economic stimulus programmes currently being launched worldwide to counter the economic recession must not be geared to conserving existing structures; they must lead to the restructuring of our economies towards greater efficiency and less carbon. If we support the automobile industry, it must not be to aid the cars of yesterday, but to promote the cars of the future with much lower fuel consumption and exhaust gas emissions. The markets of the future are above all in countries that will play a key role in combating the looming challenges, especially in Asian countries.

III.
For several years we have therefore been carrying out high-level environmental fora in close corporation with German industry, especially in China and India. These fora are triggering concrete projects in the countries concerned.

In November 2008 we held the first Indo-German Environment Forum in New Delhi - together with the German Asia-Pacific Business Association, which I would like to thank, Dr Hambrecht, for the excellent cooperation. With 250 representatives of businesses, associations and governments of both countries we held discussions in New Delhi on climate and energy policy, water, waste water and waste management. During these discussions it became clear that India is currently experiencing a paradigm change, which is opening up access to a huge growth market for environmental technologies made in Germany.

The same applies to our cooperation with China, where we will hold the third Sino-German Environmental Forum in June this year - again with the APA - in the framework of the strategic environmental dialogue between our two countries.

Together with the head of the Chinese National Development and Reform Commission Zhang Ping I signed a Memorandum of Understanding between our two governments in January in which we agree on a Sino-German partnership on climate protection. The first meeting of the working group established by this Memorandum of Understanding will meet before the summer in Beijing.

Incidentally, the US under President Obama is following our example. Secretary of State Clinton announced a few days ago that negotiations will be launched with Beijing in the coming weeks on a Sino-US climate partnership. Competition from the US will increase drastically over the coming months.

In contrast to many OECD countries, economic cooperation is already a fundamental component of the strategic environmental dialogue between Germany and newly industrialising and developing countries.

This not only applies to China and India. We are also active in other countries: only last week my Parliamentary State Secretary Michael Müller was in your home country Thailand, Dr Surin. The Federal Environment Ministry will promote several projects there over the coming years to support Thailand's climate protection strategy.

My ministry's climate protection initiative, which is financed by the sale of emission allowances, supports climate protection projects worldwide in developing and newly industrialising countries. The goal is to tap existing potential for emission reductions and to advance innovative model projects. With 33 projects, the Asia-Pacific region is currently one of the focal regions of the initiative.

Furthermore, in this legislative period the Federal Environment Ministry has for the first time adopted framework agreements on the Clean Development Mechanism (CDM) with selected countries. The Clean Development Mechanism promotes technology transfer and international climate protection. This flexible mechanism under the Kyoto Protocol enables companies from industrialised countries to achieve the emission reductions prescribed by emissions trading via additional purchases from newly industrialising and developing countries. Germany has now registered 129 CDM projects worldwide. 99 of these projects are in the Asia-Pacific region. The list of projects is headed by China, India and Malaysia.

A further important step for international climate protection was taken in Bonn in January this year: 75 countries signed the Statute of the International Renewable Energy Agency, IRENA. The German government actively canvassed for support for the establishment of this Agency. We hope that countries from Asia, which are currently under-represented, will soon sign up to this initiative. IRENA's goal is to assist in combating the numerous obstacles that have so far hindered the rapid expansion of renewable energies. The market is still being distorted by subsidies for conventional forms of energy; there is insufficient technical know-how and widespread misinformation. This is why IRENA will provide concrete advice to industrialised and developing countries for the introduction of political and legal framework conditions. It is a question of creating the right incentives and security for investments.

IV.
Ladies and Gentlemen,
You may rightly ask how exactly German industry can get involved. In order to provide coordinating support here, we are operating the following initiatives in addition to the environmental dialogues mentioned earlier:

• In the waste management sector, the Export Initiative Recycling and Efficiency Technologies, known as RETech for short, was launched in 2007. RETech supports companies in establishing contacts. This initiative came about on the basis of a study by the Federal Environment Agency. The study calculated investment needs of 43.5 billion euro from 2004 to 2020.
• The German water sector has also developed a new approach to international cooperation over the past year: the German Water Partnership has been established as a joint initiative by companies and research institutes with the support of five German ministries. The goal of the German Water Partnership is to strengthen the competitiveness of the German water and water research sectors on international target markets. In the area of the water supply alone, global investment needs amount to over 150 billion euro. If wastewater treatment and water efficiency technologies are also calculated in, investment needs of around 480 billion euro by 2020 are predicted.
• However, the framework conditions in newly industrialising and developing countries are often difficult. The BMU Service Unit for Environmental Technology Export and CDM Projects was therefore set up at my ministry in 2007. This unit, in cooperation with German institutes for the promotion of foreign trade and investment, supports German companies experiencing difficulties in implementing their projects in developing and newly industrialising countries.

I am very pleased that cooperation between my ministry and industry has been significantly expanded over the past three years. I would therefore like to conclude by expressing my thanks for the support and active participation of German companies in the framework of our environmental cooperation with growing economies in the Asian region, and I also thank our Asian partners.

Because one thing is clear: together we can achieve a great deal.

I thank you very much for your attention.